Insurance Retirement Plans

An individual participant personally received eligible rollover funds from a profit-sharing plan. What is the income tax withholding requirements for this transaction?

20% is withheld for income taxes

Conduit IRA

A holding tank for funds that originally came from a qualified plan and are on their way to another qualified plan. No withholding tax is necessary unless any of the funds are distributed directly to the person

A description of a qualified plan's insurance contract may be found in which ERISA reporting form?

Annual return/report (Form 5500)

Which of the following can be used to avoid the mandatory withholding tax on qualified plan distributions?

Conduit IRA

An officer for a corporation takes out numerous unsecured loans from the company's qualified retirement plan. Which of these rules is the plan in violation of? Key employee rule Top heavy rule Vesting rule Exclusive benefit rule

Exclusive benefit rule

The Marital Deduction

Generally exempts IRA transfers from estate taxes

Which tax would an IRA participant be subjected to on distributions received prior to age 59 1/2?

Income tax and penalty tax

Alienation of Benefits

Involved the assignment of a pension or retirement plan participant's benefits to another person. It is permitted only under the exceptional circumstances per IRS rules.

When funds are transferred directly from one IRA to another IRA, what percentage of tax is withheld?

None

What does a 401(k) plan generally provide its participants?

Salary-deferral option

Exclusive Benefit Rule

The assets held in a company's qualified retirement plan must be maintained for the exclusive benefit of the employees and their beneficiaries

The IRS has a "minimum coverage" rule regarding qualified retirement plans. This rule states that each qualified plan is required to

benefit a broad cross-section of employees

XYZ Corp has implemented a qualified retirement plan. This plan may NOT discrimate

in favor of highly compensated employees

Rick recently died and left behind an individual IRA account in his name. His widow was forwarded the balance of the IRA. The widow qualifies for the

the marital deduction